Samsung Pays Ericsson $650 Million for Phone Technologies

Ericsson announced that it has signed an agreement with Samsung that ends all ongoing patent related legal disputes. The agreement includes an initial $650 million payment and ongoing royalty payments from Samsung for the term of the new multi-year license agreement.

"We are pleased that we could reach a mutually fair and reasonable agreement with Samsung. We always viewed litigation as a last resort," said Kasim Alfalahi, Chief Intellectual Property Officer at Ericsson. "This agreement allows us to continue to focus on bringing new technology to the global market and provides an incentive to other innovators to share their own ideas."

The cross license agreement covers patents relating to GSM, UMTS, and LTE standards for both networks and handsets, Ericsson revealed. The company currently owns more than 33,000 patents that span across key technology for 2G, 3G and 4G handsets and networks. The company also has over 100 active license agreements.

Samsung originally signed a licensing deal with Ericsson back in 2001, and then renewed it in 2007. However, in 2011 when the licensing deal was up for renewal, both parties were unable to reach an agreement. 

Ericsson sued Samsung in 2012, claiming that the Korean smartphone maker infringed on its patents regarding touchscreen functions, network efficiency and clearer voice transmission. Samsung accused Ericsson of demanding substantially higher royalty rates for the same patent portfolio. The new agreement ends the dispute.

"This agreement ends complaints made by both companies against each other before the International Trade Commission (ITC) as well as the lawsuits before the U.S. District Court for the Eastern District of Texas," reads Ericsson's press release.

The details of the agreement are confidential and will not be disclosed, Ericsson stated. The company also pledged to license its standard-essential patents on fair, reasonable, and non-discriminatory (FRAND) terms.

Is Samsung trying to prevent another Apple-type dispute? Samsung just signed a patent agreement with Google, and another five-year agreement back in November with Nokia.

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  • verenos
    Way to go with the Title Kevin. I think you may have forgotten a couple of zeros!!
  • Jerky_san
    Wow.. theres a difference between $650 and 650 million.. Should change the title..
  • usertests